Helios, or Huilianyi, a Shanghai-based startup that includes Tencent, Didi Chuxing, and Sany Heavy Industry as their clients, announced the completion of a Rmb300 million ($42 million) round for the on March 27.
China Renaissance’s Huaxing Growth Capital Fund led the investment, joined by existing investors Softbank China Venture Capital, Blue Lake Capital and Zcapital.
“The proceeds this time will be used for market expansion, including the development in Japan and new product research,” Zhang Changzheng, chairman and CEO of Helios told FinanceAsia in an exclusive interview last week.
Helios provides tools to connect employees’ business travel and expense to companies’ accounting system. “Our target clients are those with high expenses, including travel, marketing, and management expense,” Zhang explained. “And companies that have complexity with certain workflow and procedures.”
The challenge for SaaS developers is creating a model that is broad based yet customisable for individual clients. Helios says it can meet customer demand far quicker than its competitors, who may require six months of onboarding time.
The company hosts close to one million monthly active users, according to its website.
Not Yet A Saturated Market
Zhang hopes the company to breakeven in 2020, with business to double in the meantime. “We are still at our early-stage of the development,” Zhang said. “We hope to become the Chinese version of Concur Technologies.” Concur is an American SaaS company providing travel and expense management services to businesses, which was acquired by SAP in 2014.
Zhang viewed internet giant such as Alibaba or Tencent to have a symbiotic relationship with the SaaS company like Helios. “For example, Alibaba’s DingTalk provides an integrated platform that allows every SaaS service provider to grow and gain more traffic volume” allowing companies to piggyback on a growing market pool.
But given the demand and outlook, competition will remain intense, particularly from smaller players. “Most of the Chinese SaaS companies were founded between 2014 to 2015, and those who survived since they need to work together to make a bigger pie,” Zhang added. “SaaS industry in China is still far from saturated.”
Given that the SaaS market in China is still small compared to North American and European markets, there should be a niche for those with a locally focused business model that can find ways to capture demand. But competition for Helios will remain domestic-based companies or international names who have managed to secure a domestic Chinese partner to team up with.
In the B2B space, having the right customers is key. Helios also includes Fosun and AXA as major clients.